1420800--3/6/2009--Colfax

related topics

{cost, regulation, environmental}

{operation, international, foreign}

{cost, operation, labor}

{tax, income, asset}

{acquisition, growth, future}

{regulation, government, change}

{regulation, change, law}

{customer, product, revenue}

{stock, price, operating}

{condition, economic, financial}

{provision, law, control}

{property, intellectual, protect}

{loss, insurance, financial}

{product, market, service}

{control, financial, internal}

{cost, contract, operation}

{personnel, key, retain}

{product, liability, claim}

Changes in the general economy, including the current global financial crisis and economic downturn, and the cyclical nature of our markets could harm our operations and financial performance. The majority of our sales are derived from international operations. We are subject to specific risks associated with international operations. Significant movements in foreign currency exchange rates may harm our financial results. We are dependent on the availability of raw materials, as well as parts and components used in our products. The markets we serve are highly competitive and some of our competitors may have resources superior to ours. Responding to this competition could reduce our sales and operating margins. Acquisitions have formed a significant part of our growth strategy in the past and are expected to continue to do so. If we are unable to identify suitable acquisition candidates or integrate the businesses we acquire or realize the intended benefits, our growth strategy may not succeed. Acquisitions involve numerous risks, including risks related to integration and undisclosed or underestimated liabilities. Once integrated, acquired operations may not achieve levels of revenue, profitability or productivity comparable with those that our existing operations achieve, or may otherwise not perform as we expected. We may require additional capital to finance our growth. If the terms on which the additional capital is available are unsatisfactory, if the additional capital is not available at all or we are not able to fully access our existing credit facility, we may not be able to pursue our growth strategy. A material disruption at any of our manufacturing facilities could adversely affect our ability to generate sales and meet customer demand. The loss of key management could have a material adverse effect on our ability to run our business. Available insurance coverage, the number of future asbestos-related claims and the average settlement value of current and future asbestos-related claims of two of our subsidiaries could be different than we have estimated, which could materially and adversely affect our financial condition, results of operations and cash flow. Our international operations are subject to the laws and regulations of the United States and many foreign countries. Failure to comply with these laws may affect our ability to conduct business in certain countries and may affect our financial performance. Our foreign subsidiaries have done and may continue to do business in countries subject to U.S. sanctions and embargoes, including Iran and Syria, and we have limited managerial oversight over those activities. Failure to comply with these sanctions and embargoes may result in enforcement or other regulatory actions. If we fail to comply with export control regulations, we could be subject to substantial fines or other sanctions. Approximately 42% of our employees are represented by foreign trade unions. If the representation committees responsible for negotiating with these unions on our behalf are unsuccessful in negotiating new and acceptable agreements when the existing agreements with our employees covered by the unions expire, we could experience business disruptions or increased costs. Our manufacturing business is subject to the possibility of product liability lawsuits, which could harm our business. As a manufacturer, we are subject to a variety of environmental and health and safety laws for which compliance could be costly. In addition, if we fail to comply with such laws, we could incur liability that could result in penalties and costs to correct any non-compliance. As the present or former owner or operator of real property, or generator of waste, we could become subject to liability for environmental contamination, regardless of whether we caused such contamination. Failure to maintain and protect our trademarks, trade names and technology may affect our operations and financial performance. If we are unable to complete our assessment as to the adequacy of our internal controls over financial reporting as of December 31, 2009 as required by Section 404 of the Sarbanes-Oxley Act of 2002, or if material weaknesses are identified and reported, investors could lose confidence in the reliability of our financial statements, which could result in a decrease in the value of our common stock and make it more difficult for us to raise capital in the future. Some of our stockholders may exert significant influence over us. The market price of our common stock may experience a high level of volatility. Provisions in our charter documents and Delaware law may delay or prevent an acquisition of our company, which could decrease the value of your shares. There may be limitations on our ability to fully utilize our net operating loss and minimum tax credit carryforwards in future periods. Our results of operations could vary as a result of the methods, estimates and judgments we use in applying our accounting policies. Any impairment in the value of our intangible assets, including goodwill, would negatively affect our operating results and total capitalization. Our defined benefit pension plans are subject to financial market risks that could adversely affect our operating results, financial condition and cash flow.

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1420800--3/6/2009--Colfax_CORP